Industrial output data sends stocks higher

NEW YORK » Wall Street shot higher yesterday after investors shrugged off a mixed reading on the housing sector and focused on the positives: a jump in industrial output, a retreat in crude oil prices and new cash pouring into the stock market. The Dow Jones industrials rose 103 points to another closing record.

Stocks initially slipped after U.S. Commerce Department data showed applications for building permits fell by the biggest amount in 17 years during April punctured an early rally. But they gradually regained strength, finding support from a Federal Reserve report that showed industrial output rose more than expected in April, and a rebound in U.S. crude and gasoline inventories that caused crude oil prices to pull back.

"We seem to be in a period of time where it doesn't make a difference what the news is -- the market seems to find a reason to go up," said Ron Kiddoo, chief investment officer at Cozad Asset Management. "How long will this last? It's anybody's guess."

According to preliminary calculations, the Dow rose 103.69, or 0.77 percent, to 13,487.53, to its 23rd record close of the year. It also had a new trading high, 13,489.57.

Broader stock indicators also advanced. The Standard & Poor's 500 index gained 12.95, or 0.86 percent, to 1,514.14, and the Nasdaq composite index rose 22.13, or 0.88 percent, to 2,547.42.

Strength in sectors such as airlines, helped by falling oil prices, gave a lift to stocks. United Airlines parent UAL Corp. advanced $1.32, or 4 percent, to $34.62; Continental Airlines Inc. rose $1.48, or 4 percent, to $37.83; and American Airlines parent AMR Corp. gained $1.28, or 5 percent, to $26.66.

Bonds showed little change despite the economic readings. The yield on the benchmark 10-year Treasury note remained flat at 4.71 percent from late Tuesday. The dollar was mostly higher against other major currencies, while gold prices fell.

The Russell 2000 index of smaller companies rose 6.02, or 0.74 percent, to 820.20.

Advancing issues outnumbered advancers by about 5 to 4 on the New York Stock Exchange, where volume came to 1.51 billion shares, down from 1.64 billion on Tuesday.

Light, sweet crude fell 62 cents to $62.55 per barrel on the New York Mercantile Exchange.

In a potentially worrisome sign, requests for new construction permits fell 8.9 percent in April, the biggest drop since a 24 percent plunge in February 1990; but investors were pleased to see that construction of homes and apartments increased 2.5 percent in April from March to a seasonally adjusted annual rate of 1.528 million units.

Investors also embraced the Fed's report that industrial output rose by 0.7 percent in April.

In corporate news, Citigroup Inc., one of the 30 stocks in the Dow industrials, rose $2.12, or 4 percent, to $54.91 after billionaire hedge fund manager Edward S. Lampert said he acquired more than 15 million shares of the financial services conglomerate.

And in another sign that liquidity is high and likely to keep buoying stocks, Warren Buffett's Berkshire Hathaway Inc. reported in a regulatory filing that it doubled its stake in Johnson & Johnson, also a Dow component. Johnson & Johnson rose $1.23, or 2 percent, to $63.05.